|Bid||0.00 x 0|
|Ask||0.00 x 0|
|Day's Range||105.50 - 107.34|
|52 Week Range||97.53 - 119.00|
|PE Ratio (TTM)||69.10|
|Earnings Date||Oct 26, 2017 - Oct 30, 2017|
|Dividend & Yield||4.32 (4.08%)|
|1y Target Est||116.62|
The fossil fuel giant thinks it can significantly grow its production and lower capital spending at the same time. Can its Permian Basin assets make that possible?
Chevron (CVX) reported production of 701 thousand barrels of oil equivalent per day in its US upstream operations.
Guggenheim’s Michael LaMotte and Ishan Kapoor have long predicted that the U.S. onshore rig count could decline by about 145 between the third quarter of this year and the second quarter of 2018, as capital expenditures come in line with cash flow. “Simply put, for the E&P industry to maintain its current level of spending through 2018, we estimate that it would need to raise $11.4B in new equity in 2H17—1.4x the $8.2bn raised in 1H17.” Some investors might be heartened by the fact that Exxon (XOM) and Chevron (CVX) have pledged to adding another 15 and seven rigs, respectively, to the U.S. onshore market in the next half dozen quarters, but LaMotte and Kapoor write that in reality these companies make up a very small portion—about 6%--of U.S. drilling activity. In fact, we estimate that the majors could add another 35 rigs next year if no large scale projects were sanctioned in 2H17 and all of the capital freed up from the completion of multi-year projects this year (roughly $5B) was redirected to the U.S. onshore market.